Restricted Party Screening for Export Control Compliance

The U.S. Government periodically publishes laws, regulations, executive orders, or directives that identify entities (e.g., complanies, organizations, institutions, and individuals) that are prohbited or restricted from engaging in specific transactions or activities (e.g., receiving an export of U.S. technology; providing services to or receiving services from U.S. entities; or receiving U.S. government funds). These restrictions can, and in some cases do, apply to the activities of insitutions of higher education.  However, it is important to note that not all restrictions are comprehensive prohibitions; some are limited prohibitions or simply require additional government review and approval (i.e., licensing) but require additional risk consideration by the University.  Historically U.S. government agencies have published comprehensive lists of restricted entities; however, recent federal legislative actions present a distinct compliance challenge by using broadly descriptive language (e.g., ABC company and its subsidiaries and affiliates) without publishing a comprehensive list of restricted entities.

To prevent inadvertent violations of applicable restrictions, the University of Virginia performs restricted party screening as part of standard business processes to identify and manage or prevent activities involving restricted entities. Restricted party screening supports compliance with export control and sanction program regulations as well as government (federal and state) non-procurement orders and other initiatives.

UVA RESTRICTED PARTY SCREENING PRACTICES

Best practice for restricted party screening is to screen all parties PRIOR investing significant time or effort in developing a proposal, contract, or other agreement. This allow potential concerns or licensing issues to be identified and, if possible, managed or resolve BEFORE significant University resources have been expended or committed.  The following restricted party screening practices are currently in place:

Export Control and Sanction Compliance: The Office of Export Controls conducts restricted party screening of all parties to proposed exports and activities involving sanctioned countries or entities.  At minimum, restricted party screening must be done prior to exporting equipment, technical data, software (including source or object code), samples or supplies.

Sponsored Programs: The Office of Sponsored Programs has automated screening of all sponsors, subawardees, subcontractors, and organizations that are parties to non-funded agreements (e.g., non-disclosure, material transfer, confidentiality or teaming agreements).  

Other Contractual Agreements: Contract negotiators in Financial Operations and other areas coordinate restricted party screening needs with the Office of Export Controls.

Procurement: Procurement and Supplier Diversity Services has automated screening of new vendors as they register to do business with the University.

Other Circumstances: The Office of Export Controls provides restricted party screening on an ad hoc basis for other University business needs on an ad hoc basis.

Proactive restricted party screening allows us to better assess and manage risks in an increasingly complex regulatory/compliance environment and supports good stewardship of University resources.

EXPORT CONTROL AND SANCTION RELATED LISTS

The following lists must be consulted prior to any export of controlled items or information from the University or prior to the provision of services to a foreign party; this does not include participation of foreign nationals in University courses or unrestricted fundamental research activities on Grounds:

  • Department of Commerce Lists
    • Denied Persons List - Individuals and entities that have been denied export privileges, Any dealings with a party on this list that would violate the terms of its denial order are prohibited.
    • Unverified List - End-users who BIS has been unable to verify in prior transactions. The presence of a party on this list does not necessarily mean that the transaction cannot go forward, but it is a "Red Flag" that must be resolved prior to proceeding with the export.
    • Entity List - Parties whose presence in a transaction can trigger a license requirement supplemental to those elsewhere in the Export Administration Regulations (EAR). The individual listing specified the requirements and policy for each listed party.
  • Nonproliferation Sanctions - Parties that have been sanctioned under various statutes. This list is issued by the Department of State, Bureau of International Security and Non-Proliferation, but the Federal Register is the only official and complete listing for nonproliferation sanctions determinations.
  • AECA Debarred List - Entities and individuals prohibited from participating directly or indirectly in the export of defense articles, including technical data, and defense services. This list is issued by the Department of State, Directorate of Defense Trade Controls.
  • Specially Designated Nationals List - Parties who may be prohibited from export transactions based on Treasury regulations. The EAR require a license for exports or reexports to any party in any entry on this list that contains any of the following suffixes: SDGT, SDT, FTO, IRAQ2 or NPWMD. This list is issued by the Department of Treasury, Office of Foreign Assets Control.

In an attempt to facilitate compliance, the U.S. Government now maintains a Consolidated Screening List that incorporates the entries from each of the lists identified above.

In addition to the lists above, University personnel with access to defense articles, including technical data, or who may be providing defense services need to be aware that the U.S. has a policy to deny licenses and other approvals for exports and imports destined for or originating in certain countries. The list of countries to which this policy of denial applies can be found in ITAR 126.1.

OTHER RESTRICTION LISTS (EXAMPLES ONLY)

Procurement-Related

Law Enforcement-Related

  • Bureau of Alcohol, Tobacco, Firearms and Explosives Most Wanted - Enforces U.S. federal laws and regulations relating to alcohol, tobacco products, firearms, explosives, and arson.
  • FBI Lists
    • Ten Most Wanted Fugitives - Investigative functions fall into the categories of applicant matters, civil rights, counterterrorism, foreign counterintelligence, organized crime/drugs, violent crimes and major offenders, and financial crime.
    • Most Wanted Terrorists - Lists alleged terrorists that have been indicted by sitting Federal Grand Juries in various jurisdictions in the United States for the crimes reflected on their wanted posters.
    • Wanted Fugitives
  • Food and Drug Administration
    • Clinical Investigators
    • Disqualified and Restricted
    • Debarment List - Individuals that have had various restrictions placed against them by the Food and Drug Administration (FDA) for scientific misconduct.
  • Office of Research Integrity Administrative Actions - The names of individuals that have had administrative actions imposed against them by the Office of Research Integrity (ORI), maintained by the Public Health Service (PHS). The Assistant Secretary for Health (ASH) makes the final PHS decision on findings of research misconduct and the imposition of administration actions after reviewing the recommendations made by ORI.

Recently the US government has also issued specific prohibitions as part of pieces of legislation; the following are examples:

  • National Defense Authorization Act 2018 (Sec. 1634) - Prohibitions on use of products and services developed or provided by Kaspersky Lab (or any successor); any entity that controls, is controlled by, or is under common control with Kaspersky Lab; and any entity of which Kaspersky Lab has majority ownership.
  • John S. McCain National Defense Authorization Act 2019 (Sec. 889) - Prohibition on Covered Telecommunications and Video Surveillance Services or Equipment.  This includes telecommunication equipment produced by Huawei Technologies Company or ZTE Corporation (or any subsidiary or affiliate of such entities); video surveillance and telecommunications equipment produced by Hytera Communications Corporation, Hangzhou Hikvision Digital Technology Company, or Dhau Technology Company (or any subsidiary or affiliate of such entities); and telecommunications or videeo surveillance equipment or services produced or provided by an entity that the US government reasonably believes to be an entity owned or controlled by, or otherwise connected to, the government of a covered foreign country (currently, only the People's Republic of China).

RESTRICTED PARTY SCREENING USING VISUAL COMPLIANCE

The University of Virginia uses Visual Compliance (TM), a web-based screening tool, to conduct restricted party screeings. Visual Compliance screens all of the lists identified above as well as many other U.S. government and foreign restriction lists; contact the Office of Export Controls at export-controls@virginia.edu for the current list of authorities consulted. The continuing compliance functionality of Visual Compliance automatically rescreens all previously screened entities whenever an update is published to a restricted party list; notifications of any "new" potential matches (based on initial screening criteria) are sent to the person who originally conducted the screening and to the administrators in the Office of Export Controls. The system also provides audit documentation and allows for false positives to be documented, preventing future notifications on that particular entity.

Individuals or units with a bona fide need for restricted party screening should contact the Office of Export Controls by emailing export-controls@virginia.edu or by phone (see Contacts).  Requests may be for ad hoc (infrequent and small volume) screening requests (no cost to the unit); set-up of new user accounts to allow for as needed manual screening (no cost to the unit); or for assistance incorporating automated screening into a new or existing process (this will likely be at some cost to the unit). For ad hoc requests, email a list of all known parties (companies, institutions or individuals) to the proposed agreement or activity along with their country of citizenhip or business location, if known, to export-controls@virginia.edu. NOTE: Most screening is done within 1-2 business days.